1. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved.

2. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. Chapter Three Business Strategies and Their Marketing Implications

3. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. Prospector Defender Analyzer Reactor Exhibit 3.1 Miles and Snow’s Four Business Strategies

4. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. Exhibit 3.2 Combined Typology of Business-Unit Competitive Strategies Competitive strategy Differentiation Cost leadership Emphasis on new product-market growth Heavy emphasisNo emphasis ProspectorAnalyzerDefenderReactor Units primarily concerned with attaining growth through aggressive pursuit of new product-market opportunities Units with strong core bus.; actively seeking to expand into rel. prod-mkts with differentiated offerings Units with strong core bus.; actively seeking to expand into rel. prod-mkts with low-cost offerings Units primarily concerned with maintaining a differentiated position in mature markets Units primarily concerned with maintaining a low-cost position in mature markets Units with no clearly defined product-market development or competitive strategy

5. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. Exhibit 3.5 How Business Strategies Differ in Scope, Objectives, Resource Deployments, and Synergy (1 of 2) Dimensions Scope Goals and obj. Adaptability (new product success) Effectiveness (inc. mrkt share) Efficiency (ROI) Resource deployment Synergy Low-cost defender Mature/stable/well- defined domain; mature tech.and cust. segments Very little Little High Generate excess cash (cash cows) Need to seek operating synergies to achieve efficiencies Differentiated defender Mature/stable/well- defined domain; mature tech.and cust. segment Little High Generate excess cash (cash cows) Need to seek operating synergies to achieve efficiencies

6. McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. Exhibit 3.5 How Business Strategies Differ in Scope, Objectives, Resource Deployments, and Synergy (2 of 2) Dimensions Scope Goals and obj. Adaptability (new product success) Effectiveness (inc. mrkt share) Efficiency (ROI) Resource deployment Synergy Prospector Broad/dynamic domains; tech. and cust. segments not well-established Extensive Large Low Need cash for product dev. (? or *) Danger in sharing operating fac. and programs - better to share tech./mktg skills Analyzer Mixture of defender and prospector strategies Mix. of defender & prospector strats. Mix. of def. & prosp. strats Need cash for prod. dev. but < prospectors Danger in sharing operating fac. and programs - better to share tech./mktg. skills